UPDATE: Yelp Posts Bigger Loss, But Sales Rise 66%

Yelp (NYSE:YELP)Historical Stock Chart

Yelp Inc. (YELP) posted a broader first-quarter loss Wednesday, as the local reviews website issued its first earnings report as a public company.

Yelp, which provides local reviews and advertising in dozens of cities, said the bigger loss came even as it saw revenue increase 66% compared to the same period last year.

The San Francisco company also projected sales for the full year that would be well above what Wall Street analysts have been expecting.

Shares of Yelp fell slightly in after hours trading, to $23.15. The stock was priced at $15 for the company's public debut in March.

Yelp faces competition in the local online reviews and advertising market from the likes of Google Inc. (GOOG). But Yelp Chief Executive Jeremy Stoppelman said he's confident the site offers "far more content, higher (user) fidelity and higher quality than anyone who competes in the space."

The company said Wednesday it launched in 11 new cities during the quarter, bringing its total to 82.

Advertising revenue from local businesses rose 91% in the period to $21.5 million, Yelp said, while revenue from the graphical display advertising on the company's websites rose 11% to $4 million.

The company's other sales are derived from a mix of local coupons, or "deals," and revenue sharing with partners.

Yelp does not include advertising in its mobile device applications, though Stoppelman said he is encouraged so far by user interaction with ads displayed on mobile versions of the Yelp site--in addition to the number of users' mobile "check-ins" and photos posted from phones.

"We love the mobile trend," the CEO said.

Yelp reported a first-quarter loss of $9.8 million, or 31 cents a share, compared to a loss of $2.7 million, or 19 cents a share, in the period a year earlier.

The recent quarter included stock-based compensation of $7.4 million, compared to $1.1 million in the period last year. Sales and marketing expenses rose 67% to $18.8 million, while overhead costs nearly tripled to $10.7 million.